Former life insurance agents busted for $1.9 million scam
News: 2018 Press Release
LOS ANGELES, Calif. — Former life insurance agents Mohammed Kakooza, 44, Margret Birabwa, 35, Michael Chibueze Monday, 43, and Denis Osikol, 36, all from the Southland area were arrested yesterday on multiple felony counts for their role in an alleged $1.9 million scam where the suspects submitted fraudulent life insurance applications to score advance commissions from insurance companies.
A joint investigation by the California Department of Insurance and U.S. Immigration and Customs Enforcement's Homeland Security Investigations revealed that between May 2013 and July 2017, Denis Osikol and Michael Monday submitted more than 600 fraudulent life insurance applications to multiple insurance companies and collecting nearly $2 million in commissions they should have never received.
"I have zero tolerance for dishonest agents who scam consumers and insurers," said Insurance Commissioner Dave Jones. "Arresting the individuals behind this complex fraud conspiracy is another win for the department and our law enforcement partners. It should serve as a warning to any agent or broker breaking the law—we will investigate and prosecute you for your crimes."
The investigation revealed over $1.2 million was deposited into a bank account owned by Margret Birabwa, nearly $700,000 deposited into bank accounts owned by Mohammed Kakooza, and over $12,000 deposited into a bank account owned by Denis Osikol. Although Birabwa and Kakooza received the majority of the commissions issued by the insurance carriers from the fraudulent applications, the investigation revealed Monday and Osikol received money directly from Kakooza and Birabwa.
"The District Attorney's Office works closely with the California Department of Insurance to ensure that consumers are protected from individuals who use their insurance license to commit serious crimes such as grand theft, insurance fraud, money laundering and tax evasion," Los Angeles County District Attorney Jackie Lacey said. "The public should rest assured that my office will vigorously prosecute those who commit these crimes."
To obtain personal identifying information for the fraudulent applications, investigators allege Kakooza set up a referral program and paid applicants between $25 to $50 for referring family members or friends to him for life insurance. Some applicants were told they were applying for life insurance policies and Kakooza would contact them with premium payment information. Some applicants never received follow-up phone calls and were unaware the life insurance policies they applied for were ever in force. In some cases, it appears multiple applications were submitted without the consumers' knowledge and allegedly contained forged signatures. The applications submitted to the insurance carriers also contained misrepresentations and fabricated information, including occupations, income, net worth, or beneficiary information.
"Fraud schemes like the one uncovered in this case result in billions of dollars in losses every year in this country and cause heartache and financial harm to law-abiding consumers," said Joseph Macias, Special Agent in Charge for Homeland Security Investigations. "HSI is committed to working with its law enforcement partners to pursue such cases aggressively—ensuring those who brazenly enrich themselves through fraud and identify theft are held accountable for their crimes."
The investigation also revealed in some cases premium payments were not paid by the applicants, but instead paid from accounts owned by Kakooza, Birabwa, or Osikol, or from accounts opened by other individuals who assisted them in carrying out commission scheme.
Life insurance policy applications were also submitted with Birabwa, Osikol, and other formerly licensed life insurance agents who were also involved in similar advance commission schemes. Investigators allege the majority of the life insurance policies that were successfully processed and placed eventually lapsed due to non-payment of premiums.
Kakooza, Birabwa, Monday, and Osikol were booked into Los Angeles County Central Jail. The Los Angeles County District Attorney's office is prosecuting the case under the California Department of Insurance's Life and Annuity Consumer Protection Program.
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- Bail amounts were set at:
- Kakooza - $550,000
- Birabwa - $475,000
- Monday - $525,000
- Osikol - $500,000
- Kakooza, Monday, and Osikol were scheduled to be arraigned today in the Los Angeles Superior Court. Arraignment for Birabwa is scheduled for tomorrow, March 22 at 8:30 a.m. in the Los Angeles Superior Court.
- The Department is taking the appropriate administrative action against the licensees and the various insurance agencies they managed.
- This case was part of one of the department's grant programs that provides funding to county district attorney offices to assist with their efforts to investigate and prosecute insurance fraud.
The California Department of Insurance, established in 1868, is the largest consumer protection agency in California. Insurers collect $310 billion in premiums annually in California. Since 2011 the California Department of Insurance received more than 1,000,000 calls from consumers and helped recover over $469 million in claims and premiums. Please visit the Department of Insurance website at www.insurance.ca.gov. Non-media inquiries should be directed to the Consumer Hotline at 800-927-4357. Teletypewriter (TTY), please dial 800-482-4833.